Renovation Time!

Sales have dropped off a steep cliff in Vancouver.

Last July came in more than 30 percent below the 10 year average.

But one thing is picking up: Renovations.

Instead of upgrading to a better home more people seem to be staying put and trying to make their home better.

The amount spent on renovations has gone up every year for the past several years, Simpson said, but added that he isn’t sure if that’s because more people are renovating or because they’ve become more expensive.

Canada Mortgage and Housing Corp’s third-quarter Housing Market Outlook, released in August, said renovation spending in 2011 was $61.7 billion in Canada. CMHC says that amount will moderate in 2012, growing to $63.3 billion, but is expected to strengthen in 2013 to $65.6 billion.

In B.C., spending on renovations in 2011 was $7.6 billion. Spending is expected to remain stable in 2012 and grow to $7.8 billion next year.

For the most part, business is good for contractors, even in this year’s moderate market, Simpson said.

“One contractor I talked to said he’s having his best year ever,” Simpson said. “He said one client bought a home and they’re spending money to update it, but most clients want to stay where they are and bring their homes up to date.”

I guess the advantage of living in a construction zone is that you can do it a little bit at a time when you can afford it, like buying a little bit of a house at a time instead of all at once.  Sounds like some people are also finding it harder to get financing for their dream homes:

Another contractor told Simpson he’s had some customers having a harder time borrowing money from the bank, which may be a result of new mortgage refinancing rules. “Some people seem to be getting a little pushback from the banks, or they might not be able to borrow as much as they want,” Simpson said. “If they can’t obtain the financing, they just have to scale it back a bit. With a renovation, you don’t have to do it all at the same time.”

Read the full article over at the Vancouver Sun.

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[…] The majority will stay put, renovate, buy back into the same market or turn their home equity into more debt via a […]

chip
chip
7 years ago

@jesse:

Could be they are revoking citizenship on the low hanging fruit; ie, those who don’t meet residency requirements. It’s pretty easy to track.

But as for bureaucrats who flee to Canada with millions in stolen govt funds, that’s pretty hard to prove. Though the Singapore govt seems wise to it and simply banned any Chinese govt officials from applying for residency.

Makes sense. If you are a Chinese govt bureaucrat you don’t have the funds or skills to be a productive PR, and if you do have the funds you are probably a crook.

jesse
7 years ago

@Chip: Interesting, Kenney commented at his press conference yesterday that a “disproportionate” number of those whose Canadian PR/citizenships are being revoked are from “Persian Gulf states”.

Anonymous
Anonymous
7 years ago

@HAM Solo: Mildly funny, but don’t give up your day job just yet, … assuming you have one.

Chip
Chip
7 years ago

Like Canada, Singapore has received a lot of mainland Chinese inflows into property. But there are differences as this story shows.

In the trial of a corrupt Chinese govt official who managed to squirrel away millions on his $500 salary, I was revealed that Chinese bureaucrats are. It allowed to apply for Singaporean PR.
http://www.todayonline.com/Singapore/EDC120911-0000163/Trial-begins-for-former-Chinese-official-arrested-in-Spore

Vancouver
Vancouver
7 years ago

What is the point of all this negativity. Living in Canada is punishment enough.

HAM Solo
HAM Solo
7 years ago

Translink top ten ideas for bus advertising to replace Realturd Kings:

1. Bankruptcy / Insolvency Kings

2. King Kredit Kounsellors

3. Casino ads (under the slogan, “Decay? Pestilence? Bring it On!”)

4. Support Our Troops (Quick, someone find us a war…Harper?)

5. 2nd hand BMW salesman Kings

6. Even better, 2nd hand BMW discount repair shop Kings

7. Family Doctors (at least they’re in short supply)

8. Rent-to-Own Furniture Kings

9. Cheque-Cashing Kings

10. Realturd Retraining Kollege Kings

Romeo Jordan
Romeo Jordan
7 years ago

He seems to have some weird login ritual you have to go through. If you take note, you’ll see that no one is posting there. It’s a barren wasteland, devoid of value, other than Chimpy’s prediction of a listings peak which I disagree with. I think peak listings for 2012 is still in front of us.

JMHO

Vote Down The Facts
Vote Down The Facts
7 years ago

@Romeo Jordan: “Can someone post on Chimpman’s site and let him know that this market is going to get crushed?”

What’s stopping you from doing it? IP ban?

Anonymous
Anonymous
7 years ago

@Best place on meth: @s: “Real estate cheerleaders are incredibly worthless.”

And you doom-and-gloom sayers provide a valuable service to society. We thank you for your service!

Romeo Jordan
Romeo Jordan
7 years ago

Can someone post on Chimpman’s site and let him know that this market is going to get crushed?

He’s delusional and needs help.

Painted turtle
Painted turtle
7 years ago

Bringing up two toddlers in a condo is not the end of the world. Ask people in Europe or Asia.
This bubble is bloated by a wave of naivety and entitlement.

YLTNboomerang
7 years ago

@gokou3: I don’t expect them yet, not until prices drop sufficiently that nobody in their right mind looks at the shoeboxes. As for the two kitchens & four bathroom issue; no big deal, you get the place for a steal so rip it out and sell the fixtures. A second gas line (if gas stove) means you now can put a gas fireplace in. Heck, put in a hot tub with the second set of plumbing!

As prices drop, 5xx soft place will be unsellable other than for student or homeless housing.

Waiting to exhale
Waiting to exhale
7 years ago

I work in a department where many of my co-workers can make close to six figures and are mostly aged between 25 and 50. For the past five years I have been constantly told to take the plunge and buy a property with all the usual arguments like: “You shouldn’t pay somebody’s elses mortgage,” or “Buy now or be priced out forever,” or the most irritating “There is no more land in Vancouver.” For the most part I just kept quiet and nodded away as I was getting real estate advice from people who shouldn’t be giving any. I had to endure this abuse for five whole years and I wanted to argue that the fundamentals just didn’t justify buying a property. But as prices continually went up I knew my arguments would fall on deaf years. Despite months of… Read more »

Romeo Jordan
Romeo Jordan
7 years ago

when do I send that fuckwad Chimpman rocks in the mail (to shove up his ass) for being so wrong about inventory having reached it’s peak (what a fucknut)?

I want him to shit rocks for all the bullshit he spews.

Reality is catching up, at long last.

I for one think this crash will be much worse than the average bear forecasts. JMHO.

mac
mac
7 years ago

@VHB: I don’t think they’re going to go in that direction this time. I had the misfortune to take a meeting with a bunch of RE guys from the burbs looking to set up a special kinda real estate marketing company online and they were all pissy about the fact that Mac (was it Cam Good?) blew the floor out from under prices.

So despite it being successful, they felt spiteful as some of their clients took too big a loss against profits. I’d say the first comment by Debt Sheeple really sums it up for the marketers in and behind the OV. They are staying calm, admitting that they’re flexible in price, but denying any big moves need to happen.

SunBlaster
SunBlaster
7 years ago

Just started my own renos recently, painting closet doors. Went to homedepot and bought $50 worth of materials, painted two doors already, looks very nice.

Best place on meth
Best place on meth
7 years ago

@VMD:

“100% without a doubt, Canada is in the midst of an immense housing bubble. The Canadian bubble outlasted bubbles in China and Australia. Because it did, I get taunts from Canadian readers all the time.”

Sounds like the same douchebags who pollute VCI are leaving comments on Mish’s site as well.

Real estate cheerleaders are incredibly worthless.

Vote Down The Facts
Vote Down The Facts
7 years ago

@s: “I think the difference between now and 2008 was that the markets were dropping and people needed to get out or needed cash cause their investments were getting wiped out.”

Don’t forget the 24/7 doom on CNN.

Vote Down The Facts
Vote Down The Facts
7 years ago

@VHB:

The H+H receivership sale was March 2008.

VHB
VHB
7 years ago

@VHB: whoops that should say September 11 not 10th of course.

VHB
VHB
7 years ago

Number of 300+ listings days in September:
2010: zero. (highest was 282)
2011: 5
2012: 4 in the first 6 days. The other two days were 290 and 295.

VHB
VHB
7 years ago

Still tracking below 2008’s 1585 sales.

Sep-2012	
Total days	19
Days elapsed so far	6
Weekends / holidays	5
Days missing	0
Days remaining	13
7 Calendar Day Moving Average: Sales	80
7 Calendar Day Moving Average: Listings	319
SALES	
Sales so far	486
Projection for rest of month (using 7day MA)	1035
Projected month end total	1521
NEW LISTINGS	
Listings so far	1960
Projection for rest of month (using 7day MA)	4150
Projected month end total	6110
Sell-list so far	24.8%
Projected month-end sell-list	24.9%
MONTHS OF INVENTORY	
Inventory as of September 10, 2012	18710
Current MoI at this sales pace	12.30